Practice Areas

Review the Statute and Administrative Rules. Visit the Bureau of Marijuana Regulation’s Website.

Administrative Rules set

R 333.212 Capitalization requirements. Rule 12.

• An applicant shall disclose the sources and total amount of capitalization to operate and maintain a proposed marihuana facility.
• The total amounts of capitalization based on the type of marihuana facility are:
  • Grower: Class A - $150,000.00.
  • Grower: Class B - $300,000.00.
  • Grower: Class C - $500,000.00.
  • Processor: $300,000.00.
  • Provisioning Center: $300,000.00.
  • Secure Transporter: $200,000.00.
  • Safety Compliance Facility: $200,000.00.
• An applicant shall provide proof of capitalization from the following sources:
  • Not less than 25% in liquid assets (cash, certificates of deposit, 401(k) plans, stocks, and bonds).
  • The remaining capitalization may include equity in real property, supplies, equipment, or non-liquid assets.
• Assets provided as a source of capitalization must be free of liens or encumbrances, except for mortgages on real property, with disclosed equity value.
• Capitalization amounts and sources must be validated by CPA-attested financial statements. For foreign sources, both foreign and domestic CPA attestations are required.

• LARA Form for Attestation
• Guidance on report
  • Do you understand how to issue this report?
  • Seek guidance on providing this type of engagement through education, written examples, etc.

AICPA Code of Professional Conduct

1.300.010   Competence

• Competence means that the member or member’s staff possess the appropriate technical qualifications to perform professional services, and that the member, as required, supervises and evaluates the quality of work performed. Competence includes knowledge of professional standards, technical subject matter, and sound judgment in applying such knowledge.
• A member’s agreement to perform professional services implies the necessary competence to complete those services according to professional standards, exercising reasonable care and diligence. However, the member does not assume responsibility for infallibility of knowledge or judgment.
• The member may have the knowledge required to complete services in accordance with professional standards prior to performance. Providing professional services may involve additional research or consulting with others to gain sufficient competence.

• AICPA Code of Professional Conduct
• AICPA Nonattest Services Toolkit
• How do you determine if you’re independent prior to performing an attest service? Check AICPA Code of Professional Conduct Independence sections 1.200-1.298.
• Still have more questions? Take a course on Independence:
  • https://store.micpa.org/Product

AICPA Code of Professional Conduct

1.000.020 Ethical Conflicts

1. An ethical conflict arises when a member encounters one or both of the following:

a. Obstacles to following an appropriate course of action due to internal or external pressures

b. Conflicts in applying relevant professional standards or legal standards. For example, a member suspects a fraud may have occurred, but reporting the suspected fraud would violate the member’s responsibility to maintain client confidentiality.

2. Once an ethical conflict is encountered, a member may be required to take steps to best achieve compliance with the rules and law. In weighing alternative courses of action, the member should consider factors such as the following:

a. Relevant facts and circumstances, including applicable rules, laws, or regulations

b. Ethical issues involved

c. Established internal procedures

3. The member should also be prepared to justify any departures that the member believes were appropriate in applying the relevant rules and law. If the member was unable to resolve the conflict in a way that permitted compliance with the applicable rules and law, the member may have to address the consequences of any violations.

4. Before pursuing a course of action, the member should consider consulting with appropriate persons within the firm or the organization that employs the member.

5. If a member decides not to consult with appropriate persons within the firm or the organization that employs the member and the conflict remains unresolved after pursuing the selected course of action, the member should consider either consulting with other individuals for help in reaching a resolution or obtaining advice from an appropriate professional body or legal counsel. The member also should consider documenting the substance of the issue, the parties with whom the issue was discussed, details of any discussions held, and any decisions made concerning the issue.

6. If the ethical conflict remains unresolved, the member will in all likelihood be in violation of one or more rules if he or she remains associated with the matter creating the conflict. Accordingly, the member should consider his or her continuing relationship with the engagement team, specific assignment, client, firm, or employer.

Peer Review requirements

Accountancy Statute

Administrative Rules

339.729 License renewal; continuing education requirements.
Sec. 729

1. Each licensed firm and sole practitioner that performs any of the following services shall participate in a peer review program established by rule of the department and approved by the board:

a. Audit.

b. Review.

c. Compilations that are relied upon by third parties.

2. An applicant for renewal shall submit to the department, on a form prescribed by the department and at the time of renewal, proof of peer review obtained within the 3 years immediately preceding the application.

3. A firm or sole practitioner required to participate in a peer review program under this subsection shall notify the department within 30 days after receipt of a fail rating or second consecutive pass with deficiencies rating. Verbal testimony or documents, or both, pertaining to a peer review shall be considered confidential and shall be exempt from disclosure to the department, except in the case of a fail or second consecutive pass with deficiencies rating.

R 338.5501 Peer review.

Rule 501.

1. Each firm or sole practitioner required to participate in a peer review program, pursuant to MCL 339.729(2), shall enroll in the program of a qualified sponsoring organization within 1 year of the earlier of the following:

a. Its initial licensing date.

b. The performance of services that require a peer review.

2. Proof of a peer review shall not be required to be submitted to the department until the second renewal following initial licensure or the performance of services requiring a peer review.

3. The department shall accept, as proof of compliance with MCL 339.729(2), the electronic submission of information from the facilitated state board access (FSBA) website.

4. Qualified sponsoring organizations shall include the center for public company audit firms (CPCAF) peer review program, the American institute of certified public accountants (AICPA) peer review program, national conference of CPA practitioners (NCCPAP) peer review program, and such other entities that adhere to the peer review standards defined in R 338.5102(1)(a) as determined by the board. With respect to an out-of-state firm required to obtain a license under MCL 339.728(1)(b), a peer review sponsoring organization approved by another state in which that firm is licensed is presumed to be qualified in this state, with respect to that firm.

5. A licensee subject to peer review shall not be required to become a member of any sponsoring organization.

6. Out-of-state firms required to obtain a peer review under MCL 339.728(5) may, in lieu of enrolling in a program sponsored by an organization described in subrule (3) of this rule, comply with the peer review requirement applicable in the state where that firm is licensed, proof of which shall be furnished to the department upon the department’s request.

Consider Your Risk

1. Liability Insurance

• Need to inquire about providing services to find out if the engagement will be covered

• Need to notify insurer if you do undertake the work

2. Classified as a schedule 1 drug by the FDA

3. Legal issues